Attorney Roya Deyhim has experience assisting individuals and families with charitable planning. A charitable plan can be set up as part of your revocable living trust planning, coming into existence at the time of your death, or as a stand-alone plan during your lifetime. The following charitable trusts are an example of options available to you today.
Charitable Lead Trust
The Charitable Lead Trust (‘CLT’) is a type of charitable trust that can reduce or virtually eliminate all estate tax on wealth passing to heirs. In order to accomplish this goal, you create a trust that grants to a charity or charities, for a set number of years, the first or ‘lead’ right to receive a payment from the trust. At the end of the term of years, your children or grandchildren receive the balance of the trust property’ which often is greater than the amount contributed, free of estate tax in most instances. The remainder interest ultimately passing to the heirs, however, will be affected by the performance of the trust’s investments.
Charitable Remainder Trust
The Charitable Remainder Trust (‘CRT’) is a irrevocable trust that permits you to transfer ownership of assets to the trust in exchange for an income stream to the person or persons of your choice (typically you, your spouse or you and your spouse) for life or for a specified term of up to 20 years. With the most common type of Charitable Remainder Trust, at the end of the term, the balance of the trust property (the ‘remainder interest’) is transferred to a specified charity or charities. Charitable Remainder Trusts reduce estate taxes because you are transferring ownership to the trust of assets that otherwise would be counted for estate tax purposes.
A private foundation may provide a tremendous opportunity for donors to educate family members as to the donors’ philanthropic goals, and may also provide younger family members with a sense of responsibility and stewardship of family wealth. The private foundation may be structured to limit the scope of its charitable activities, by defining the permissible donees for charitable distributions, or may be structured to allow for unlimited charitable activities. Moreover, the private foundation may employ family members (subject to limitations as to reasonable compensation) to coordinate the foundation’s activities for generations to come.
Contact Charitable Planning attorney Roya Deyhim today to learn what charitable planning options will work for you and the charities you want to benefit.